Almost two years in to bankruptcy and AMR chief executive Tom Horton is smiling.
The carrier posted its second straight quarterly profit on Thursday, has accumulated over $7 billion in cash and investments and is set to make its first profit-sharing payment to employees in over a decade, all which is quite a reversal from American Airlines’ parent company’s poor performance in 2011 when it posted an almost $2.0 billion loss.
“There was a reason why some of our big competitors were out-performing us,” Horton said. “Now it’s our time.”
In an interview with the Star-Telegram on Thursday, Horton discussed the carrier’s strong financial performance and whether the merger with US Airways is still in the cards for the Fort Worth-based airline.
On if American’s financial success diminishes the need for a merger with US Airways: As we said from the outset, of course American is going to be very successful after having been restructured. I think the results speak for themselves there but the merger will make us stronger because it will give us a bigger, broader network and allow us to be even more globally competitive. So we’ll be successful but we’ll be even more successful with the merger.
On if a profitable American and profitable US Airways hurts their case in the antitrust trial against the DOJ: Strong companies merge all the time and we think a strong company means a strong merger and the standard for the DOJ is to prove that the merger is anticompetitive, not whether or not American or US Airways is making a profit.
On the carrier’s fleet renewal plan: Today we’ve taken 43 new airplanes and for the full year we’ll take 60. For the next year we’ll take 63. It’s an unprecednet renewal of the fleet and as you know that has huge leverage on fuel costs, maintenance costs and operating costs in general. But maybe more importantly it has a huge benefit for our customers. They’re seeing state of the art product and we hear a lot of buzz about that from our customers now which is exciting.
On the recent public campaign to put pressure on the DOJ: I do think it is important and relevant that there is near universal support for this merger. I think it is important that is made evident. We obviously believe in the merger. We think it’s good for all of American’s constituents. It’s good for all of US Airways’ constituents. We’re going to do our best to tell that story everywhere that it’s appropriate. We’re now in the zone where this will be a question for the Justice Department and the courts and we’re respectful of that.
On the merger uncertainty’s effect on the workforce: I think it’s a great credit to the entire team at American that everybody is standing tall, doing their jobs every day and doing a great job for our customers and the results are showing. I think it’s great that in the meantime, those results are being translated into profit sharing for recognition of what our folks are doing. I think it’s also great that we’re now back in hiring mode. We’re hiring 1,500 pilots over the next five years. We’re hiring 1,500 flight attendants this year alone and we’ve hired some agents and reps as well, I think 1,200 over this year. All of that begins to create more movement and opportunity and excitement at the company and I think you see that onboard our airplanes.
On being in bankruptcy for almost two years: Obviously, when we entered the process, we weren’t contemplating a merger prior to emergence. We were contemplating emerging independently and then pursuing the strategic options on the other side. As we got our restructuring well in hand and held off merger talks long enough to get the independent company looking strong and durable then, we were able to negotiate from a position of strength and create a really good outcome for all constituents so I am pleased with that and the way it worked out obviously. I am not pleased the company remains in restructuring because its costly and its disruptive. So we’re very keen to bring this to a close, either win our case or settle or it and move forward with the world’s leading airline.